Discussion in 'Stocks' started by peilthetraveler, Mar 15, 2012.

  1. I know Wall St. hates tankers right now, but I purchased FRO about a month ago for $5.15. It paid off as tanker rates are going nuts right now. They've about doubled in the last few days. Just a few days ago suezmax rates were $23k per day. Today they are $37k. There was a big jump in FRO today and in afterhours also, but I still think the stock is going to $30 this year.
  2. I remember owning NAT from 38 to 55, then at 49 they did a secondary share offering. After dropping to $45 I was out, and down went all of the tanker groups.

    I can recall FRO was $60 at one point, so keep dreaming about $30.
  3. FRO opened today at $6.65. Its up to $7.55 as we speak. FRO was also down to around $3 per share back in 2002 before it shot up to $60 in 1 or 2 years and paid about $30 or so in dividends.

    Baltic dry index is on an upward trend now(up almost 40% since beginning of february) Tanker rates are also going up pretty fast. The shippers seem like a good bet right now. But yeah, shippers are a little volitile and they do take some stomach to get used to. I normally do not buy tankers, but i've been watching FRO since 2005 and decided now was the time to get in. (yeah I've been waiting a long time for that one) :D
  4. I have been watching these shippers as well, waiting for the day when they are a buy again but I think you may be premature. The BDI has bounced off the bottom it has been forming for a long time but there is still the glut of ships that were built during boom times. A couple of months ago stories were coming out about shippers taking routes just to keep the ships moving and avoid them sitting idle and deteriorating at sea. I do think that FRO and DRYS will one day be 5 or maybe even 10 baggers but I could see shippers selling into this BDI bounce very quickly when the current euphoria wears off. Don't get me wrong there probably is not much risk parking capital in the names now ahead of market moving but there may be better returns elsewhere in the short term.
  5. Yes, there are alot of ships out there and the media has no problem reporting it week after week. What they do not report is that many of the smaller shippers are getting knocked out of the arena which means less ships active which means higher prices for the big boys like FRO because there are less shippers even though there are plenty of ships.

    For instance...A big company in the US, General Maritime has just gone bankrupt. They had 34 ships in their fleet and were the 2nd biggest in the US. Thats 34 ships that will no longer be in service for quite a few months while the bankruptcy courts arrest the ships and force their sale to satisfy bondholders.

    Omega navigation has another 15 tankers that will be out of service soon (if they are not out already) All these guys are going bankrupt at the same time so this is why I believe rates have been shooting up the last week or so.
  6. Closed at 8.28 today (up another 8%) after hitting a high of $9.50. I'm guessing we will see $11 by the end of the week.
  7. nocloud


    Up 30% in two sessions...I think we're pretty overbought already, probably looking for a double digit decline tomorrow. $11 will see it double in a week, all it takes right now is a small dip before everybody profit takes and it collapses.
  8. Solid call. Congratulations.
  9. Thanks for sharing. This looks like a great one.
    #10     Mar 19, 2012